Abstract: A lossy compression algorithm based on discrete Fourier transform was proposed, which was designed to reduce working parameters redundancies of oil well. The influence of truncation effect was attenuated by adding cyclic prefix and postfix instead of filling zero at the end of the sequence. The spectrum leakage and spectrum spreading, which was harmful for the data compression, was decreased significantly by adding windows in time domain. Details on compression and decompression methods for both high performance and low performance processors were all proposed. As demonstrated by our simulation and experiments, the compression ratio of this algorithm is about 5%~20%, this beneficial will reduce the wireless network transfer delay and power consumption.